NMa: current crisis is no excuse for concluding illegal agreements
'Undertakings that are each other's competitors should not enter into illegal agreements, such as price-fixing agreements, and then conveniently use the current economic crisis as an excuse,' warns Pieter Kalbfleisch, chairman of the Board of the Netherlands Competition Authority (NMa), during the presentation of the 2008 Annual Bulletin of the NMa.
The NMa has received indications that undertakings are sitting down to discuss with one another how to deal with the current economic crisis. 'There's nothing wrong with that in general. However, it becomes a problem if such talks lead to illegal agreements that impede competition by, for example, fixing prices or by dividing the market.' Each undertaking should set out its own strategy, including pricing policy. 'We are certainly not blind to the difficult circumstances that undertakings are in right now, but these are not an excuse for concluding all kinds of illegal agreements. It takes innovativeness and creative entrepreneurship to weather a crisis, and cartel agreements will only curb these, which will ultimately result in higher prices and less choice for consumers,' says Mr. Kalbfleisch. He also points to figures, calculated by the NMa, that give an estimate of the effects of the NMa's enforcement. 'The effect of our work, which is what we have saved consumers, amounts to approximately €700 million. Regulation of the energy and transport markets has contributed the most to those savings.' The 2008 Annual Bulletin explains how the NMa has put its 2008 NMa-agenda into practice. The annual report, which will be published in April 2009, will feature a more in-depth overview. Much attention was devoted to, among others, the health care and energy industries.
The health care industry has been an area of attention of the NMa for quite some time already. The number of mergers in the health care industry has seen an increase last year, primarily because of the lowering of the turnover thresholds (from €113 million to €55 million) for when parties in the health care industry are required to notify the NMa of their concentration plans. The NMa has reviewed four concentration cases in the health care industry in which conditions have been attached to the plans because the NMa expectated competition to be possibly at risk if no conditions were to be attached. Furthermore, for the first time ever, the NMa has imposed fines on five home-care providers in the Dutch regions of Kennemerland and 't Gooi for having divided their service areas and clients amongst themselves. Such practices harm clients because they are then no longer able to choose their own care provider.
Attaching much value to the availability of understandable and reliable information on the energy market, the NMa launched an online comparison tool, called 'Energiewijzer' (in Dutch), in 2008. This interactive tool can be found on www.ConsuWijzer.nl/energiewijzer and helps consumers in comparing energy companies on aspects such as the quality of their service, contactability, and their product range. Much attention in 2008 was also devoted to the tariff regulation of the network operators, which are monopolists by nature and are therefore not faced with competition stimulating them to become more efficient. Partly because of the NMa's study into the profits of network operators, the tariffs have been further lowered through new method decisions for 2008.
Results for 2008
Fines that the NMa imposed in 2008 total almost €12 million, mostly for violations of the Dutch Competition Act and of the energy and transport acts. The NMa has drawn up reports of 11 investigations in which it is concluded that a violation is suspected. The NMa handled 29 complaints, 119 merger and/or acquisition cases, concluded with a decision, and 154 appeals against a decision of the NMa, of which 74 construction-industry cases. The Office of Energy Regulation of the NMa made a total of 119 decisions and advised the Dutch Minister of Economic Affairs in 16 cases. Through ConsuWijzer, the joint information service of the NMa, the Independent Regulator of Post and Electronic Communications in the Netherlands (OPTA) and the Dutch Consumer Authority, the NMa also dealt with almost 25,000 questions, tip-offs and reports with regard to competition, energy and transport.